Black Sea War Significantly Raises Trade Costs
The Russia-Ukraine conflict's escalating attacks on commercial vessels in the Black Sea have heightened security concerns, leading to substantial increases in freight and insurance expenses.
This story was prepared with the help of artificial intelligence, compiled from several sources, and read and approved by our editor.
The conflict between Russia and Ukraine entered a new phase with Russian President Vladimir Putin's declaration of a "special military operation" on February 24, 2022. As the war extended beyond strategic targets to commercial shipping, maritime transport in the Black Sea faced significant risks. During July and August 2026, approximately 300 vessels, both civilian and military, were reportedly hit in the region, with 35 commercial ships struck in July alone. Since February 2022, a total of 43 Turkish-linked vessels (Turkish-owned, operated, or flagged) have been targeted.
These developments profoundly impact Turkey, which has extensive commercial activities in the Black Sea. The sea transport of many products, especially grains, as well as feed raw materials, vegetable oils, coal, iron-steel products, fertilizers, and petroleum, faces severe difficulties. Reports indicate that finding vessels in the region has become challenging due to safety concerns.
According to a source in the maritime sector, ship insurance costs have surged from 1.5% to 6% over the last three months, while freight charges have risen from $30 to $100 per ton. Gennadiy Ivanov, Director of BPG Shipping, stated that war risk insurance premiums for Black Sea passages increased last week from 0.2-0.5% of a vessel's value to a range of 0.6-1%.
The escalating security risks and costs are compelling companies to opt for longer coastal routes. This situation increases fuel consumption and transit times, exerting upward pressure on global grain and oil prices. It is also noted that some shipping companies have begun employing crew members from India and Bangladesh instead of Turkish and European sailors to mitigate their losses.
The dangers posed by attacks in the Black Sea have also been highlighted by recent incidents. On October 6, 11 Turkish and 7 Indian sailors were rescued from the Palau-flagged vessel Able, which was targeted by drones off the coast of Bulgaria. Following the sinking of the Alfa Watan vessel, operated by Mersin-based Baraka Shipping, nine Syrian and one Egyptian crew members are presumed to have lost their lives.
Insurance brokers and commodity traders report that premiums for Black Sea transits are rapidly increasing and showing volatile trends. Premium rates can vary based on the vessel's characteristics, the cargo being transported, and the specific route taken.